Jayesh Krishnan (Equity Research Analyst) (32 Points)
17 November 2009Hi,
My company (based in Navi Mumbai) is exempt from service tax due to the the services being provided to a U.S company and the remuneration being received in India in foreign currency. We do file service tax returns with nil tax.
We are planning to take a commercial property on rent. The landlord has asked us to pay service tax on rent. Will we have to pay service tax on rent as our company is exempt from service tax.
Kindly reply to this query
Regards
Jayesh
CA Sumit Arora
(CA)
(1411 Points)
Replied 17 November 2009
yes you have to pay service tax, Service Tax is Exempted only on Export of Services as Per Export of Services Rules, 2005.
In addition to above Services provided to following will be exempted
1. Services to UNO
2. Serivces to diplomatic mission for their personal or official use.
3. Services provided in Special Economic Zone.
Y.N.Vinod
(Consultant - Risk Advisory Services)
(98 Points)
Replied 27 November 2009
You have got the exemption only on the collection of the service tax on your taxable services. But the rent you are going to pay is the taxable service of others.
Hence, you are liable to pay the service tax on the rent.
Sunil
(Trader)
(2611 Points)
Replied 27 November 2009
You have to pay the landlord his rent less TDS plus the service tax. the landlord will register and pay the service tax.
If you have taxable services provided to residents, we will have to check if you can claim input against a taxable output. Usually they allow it if it can be corelated to your taxable output.
CAclubindia
